Why HPCL shares are down in six of past seven sessions; buy opportunity?  

Shares of Hindustan Petroleum Corporation Ltd (HPCL) fell on Friday, despite a hike in petrol and diesel prices. The stock has even ignored strong Q4 results, as it slipped in six out of the past seven sessions. The fall came as analysts see huge losses for the oil marketing company (OMC) in the June quarter and weak momentum at large across refining, marketing, and new businesses in FY27. Amid a challenging environment, policy support holds the key, they said.

At 11.53 am, HPCL shares were trading 3.22 per cent lower at Rs 365.40. At today's low of Rs 363.20, the scrip is down 9 per cent in seven sessions. Elara Securities has downgraded HPCL to 'Accumulate' from 'Buy' and cut its target to Rs 444 from Rs 627, as elevated crude prices and ballooning retail and LPG under-recoveries are impacting near-term earnings sharply. 

"We cut FY27E/FY28E EPS estimates by 96 per cent/64 per cent to Rs 4.30/36.60 and introduce FY29E EPS of Rs 80.20. While HPCL delivered a beat on PAT in Q4FY26, the focus has shifted to scale and duration of under-recoveries in FY27," Elara said adding that the stock will be driven more by policy support and crude normalisation.   

From a one-year view, said YES Securities. FY27 profit is expected to decline year-on-year (YoY) with large impact from marketing, followed by refining segment. HPCL, it said, has a negative buffer of Rs 1,27,99 crore ending Q4FY26, pertaining to LPG subsidy. The company received a letter from MoP&NG in October 2025, which conveyed compensation of Rs 7,920 crore towards under-recoveries incurred on sale of domestic LPG up to 31.03.2025. 

"The company has received Rs 1,980 crore during Q4FY26 which is recognized as sales of products. This inflow could cover portion of HPCL’s FY26 capex guidance of Rs 13,000 crore, easing dependence on
short-term borrowings and supporting deleveraging below the current 0.8x debt-to-equity ratio," YES said.

Nomura India anticipated sharp losses for the OMC in the fuel and LPG marketing segment in the March quarter, with the run rate of Rs 27 per litre blended losses in petrol and diesel and Rs 680 per cylinder under-recovery in LPG. 

The foreign brokerage said fuel retailing losses will be partly offset by a windfall tax on diesel exports for standalone refiners. 

"OMCs are staring at significant losses in the absence of meaningful fuel price hikes," Nomura said while downgrading the stock to 'Neutral' with a lower target price of Rs 440. 

Nuvama said Q1FY27 may see a loss owing to weak marketing margins on high crude prices. Saying risk reward is unfavourable, it retained its 'reduce' on the stock with a target of Rs 372.

MOFSL said HPCL currently trades at 1.1 times FY27 book value. It estimated the company to deliver return on equity (RoE) of 16.2 per cent in FY28 and a 5.4 per cent FY28 dividend yield. 

"We have not assumed any significant benefit from the start-up of a bottom-upgradation unit and Project Samriddhi. We reiterate our BUY rating on the stock with an SoTP-based target of Rs 455," it said.